GIVEN the mind-bogglingly calamitous circus performance at Westminster, as the Conservatives’ deep divisions over the UK’s (foolish) Brexit move have blown up big style, it might seem strange to argue what is going on in Parliament is a sideshow.
However, without wishing to understate in any way the importance of MPs’ duty to act to mitigate the huge damage arising from Brexit, or far better to stop this foolishness altogether, it is crucial to realise that much of the main-stage action is happening elsewhere. In the country at large.
The Brexiters continue to waste further time and ramp up the potential for economic damage to the UK even more by pushing through amendments that might appear to some to be infantile, such as the spoke-in-the-wheel nonsense about potentially not collecting tariffs for the European Union. However, as they play their political games, the consequences of Brexit are already playing out in the real world. And they have been for a long time.
This is not some university debate with no consequences, even if the Brexiters’ behaviour might give the impression that it is. Brexit is an act of sheer folly that has already cost UK households very dear, through a protracted real-terms fall in incomes fuelled by an inflation surge arising from sterling’s post-Brexit vote weakness. And, by dampening business investment and unnerving households, it has already exacerbated the embattled UK economy’s woes hugely.
While the Conservatives’ Brexit circus has been in full swing this week, and throughout July so far, there has been plenty going on in the real world in terms of mounting evidence of the true economic consequences of the UK’s impending exit from the EU.
Figures published by the Office for National Statistics on Monday revealed net immigration of citizens from other EU countries to the UK tumbled to 101,000 in 2017, its lowest for nearly five years, from 133,000 in 2016. In the 12 months to June 2016, net immigration of citizens from other EU countries to the UK totalled 189,000.
The plunge in net migration to the UK from other EU countries is hardly surprising, given the huge uncertainties for people from these nations about the realities of a post-Brexit UK.
Emigration of citizens of other EU countries from the UK rose to 139,000 in 2017, the ONS data showed. The Migration Observatory at the University of Oxford noted this was a record high.
It is inevitable that many of those people with the skills which are in greatest demand will use the freedom they have to move around the EU, and up sticks to a more outward-looking country where they can be certain of what the future holds.
The unwelcoming (and unwelcome) image of the UK that some Brexiters are presenting to the world is also likely to discourage people from moving to this country from other EU nations. It is natural for people to be more inclined to move to places where they feel they are wanted and needed.
People from other EU countries are definitely needed from the perspective of the economy and society, and are wanted by many, but some of the Brexiter hysteria is just so intolerant and shrill that it tends to drown out the more gentle voices of reason. Empty barrels, squeaky wheels and all that.
There are other Brexit-related factors at play in the fall in net immigration. Sterling’s post-Brexit vote weakness, of course, makes the pounds earned by workers from other EU nations worth less in euro terms. So, for example, people from other EU countries working in the engineering sector might be better off getting themselves a job in the likes of Germany, rather than the UK.
One thing is for sure: the UK has become a far less attractive destination for workers from other EU countries than it was before the Brexit vote. Sadly, given the intolerance fuelled by the Brexit vote, this sorry state of affairs looks unlikely to change.
Talking of engineering, it was interesting to hear Rolls-Royce chief executive Warren East raise the possibility of having to stockpile parts if the UK got ever closer to the Brexit date of March 2019 without clarity on what was going to happen, with the threat of a disorderly exit looming.
Sadly, things are becoming even less, rather than more, clear.
“Unstable” would surely be a euphemistic term now to describe the Conservative Government.
EU negotiators and leaders could be forgiven for being somewhat baffled by the mixed signals they have been getting from the UK over the last two years. Then again, maybe they realise the divisions in the Westminster Government are so deep as to make the continually shifting UK attitude towards the negotiations inevitable.
Prime Minister Theresa May will certainly not have helped quell the fears of businesses this week with her declaration that the EU should be in no doubt the UK is preparing for a no-deal scenario.
Accountancy firm PricewaterhouseCoopers this week highlighted the dampening impact of Brexit-related uncertainty on UK business investment and on the financial sector. PwC forecasts the UK economy will grow by only 1.3% in 2018 and by 1.6% next year, even on the basis that Brexit negotiations “proceed reasonably smoothly”.
However, it warned that an “extreme hard Brexit”, where the UK falls out of the EU in March without any trade deal or transitional arrangement, so reverting immediately to World Trade Organisation rules, was clearly a “key downside risk”.
It might still seem to many people that the UK Government’s sporadic but scary no-deal chat is merely tough talk to strengthen the UK’s (extremely weak) negotiating hand.
Sadly, the big problem is that a no-deal scenario is a very real one, and looks ever-more possible as the Conservatives squabble among themselves, the clock ticks surely towards Brexit, and our long-suffering EU neighbours become increasingly exasperated. Such a scenario would be truly calamitous.
However, some Brexiters have made it clear they prefer such a “hard” exit, seemingly regardless of the consequences. Their ideology appears, for them, to trump any considerations about the cost of such a disastrous exit, in terms of wholesale job losses, choking already very weak UK growth further, and hitting household finances harder.
Then again, maybe the arch-Brexiters are too wrapped up in their circus to see the real-world situation.
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